Don't issue ultimatums to employees. Rather, use the point of an ultimatum to determine when you have a square peg trying to stick into a round hole.
We all get there at some point. The point of no return. The breaking point. End game.
For employers perhaps it is an employee missing deadlines or perpetually being late. Perhaps it is missing target revenues or other benchmarks. Whatever the case, our human instinct is to lash out and issue an ultimatum. "If you miss one more deadline that's it!" or "If your sales don't increase we will have to let you go."
Whatever the form they take ultimatums rarely solve the underlying issue. Sure they may provide a temporary solution, an employee working harder or being more diligent in the short run. But in the end, if an employee is not living up to expectations should you really allow them to continue with the company?
Putting it another way, does the issuance of ultimatums, over and over, more readily reveal a poor employee or a failure in management? Consider why you are issuing an ultimatum. If you stop and think about it, by definition isn't an ultimatum only issued when you have exhausted all other options? If so, why issue an ultimatum? Is it not the last step in trying to wedge a square peg into a round hole?
If you have addressed a situation in the past and the employee still fails to meet expectations is it not your job to identify a consistently under performing employee and replace the same rather than to give them endless chances? In short, do not issue ultimatums as the square peg will, for a time, squeeze itself into the round hole. But at the end of the day, and over time, the square peg will remain a square peg.
Rather, recognize that when you get to the point of an ultimatum you are dealing with an employee that is simply not a good fit for the company and it is time to remove the square peg altogether.
We all have our own respective management styles and it is always in the best interest of any company to hire and retain a high-quality work force. To this end, turn over should be avoided whenever possible.
However, when an employee does not live up to expectations and the situation has been repeatedly addressed do not issue an ultimatum, simply move them along and continue looking for the right pegs for your business model.